MP Materials Surges 7.12% on $150M DOD Loan and Strategic Alliances—What’s Fueling the Rally?

Summary
• MP Materials (MP) surges 7.12% to $79.615, hitting a 52-week high of $82.50
• $150M DOD loan and $500M Apple partnership drive rare earth production expansion
• Q2 2025 revenue jumps 84% to $57.39M, with net loss narrowing to $30.87M
MP Materials is riding a wave of strategic momentum, fueled by a landmark $150 million loan from the U.S. Department of Defense (DOD) and a $500 million partnership with Apple. The stock’s 7.12% intraday gain reflects investor optimism over the company’s role in reshaping the U.S. critical minerals supply chain. With rare earth demand surging and geopolitical tensions intensifying, MP’s rally underscores its pivotal position in the race for domestic mineral independence.

DOD Loan and Strategic Alliances Drive MP Materials' Rally
MP Materials’ explosive 7.12% gain is directly tied to the $150 million loan from the Office of Strategic Capital (OSC), a DOD initiative, to expand heavy rare earth separation capabilities at its Mountain Pass facility. This loan, funded by the One Big Beautiful Bill Act, aligns with broader U.S. efforts to counter China’s dominance in rare earth processing. Simultaneously, a $500 million partnership with Apple to produce recycled rare earth magnets and expand domestic mining capacity has solidified MP’s strategic value. These developments, combined with Q2 2025 earnings showing an 84% revenue increase and a narrowed net loss, have positioned MP as a cornerstone of U.S. industrial resilience, driving aggressive buying.

Rare Earth Sector Gains Momentum as MP Materials Leads
The rare earth sector is witnessing a surge in activity, with competitors like Idaho Strategic Resources (IDR) and Energy Fuels reporting high-grade rare earth discoveries and processing advancements. However, MP Materials stands apart due to its exclusive U.S. rare earth mine and direct government backing. While companies like American Rare Earths and Mkango Resources focus on exploration and pilot projects, MP’s DOD and Apple partnerships provide immediate revenue visibility and geopolitical leverage. This strategic differentiation has amplified MP’s rally relative to peers, which remain in earlier development stages.

Options and Technicals Signal Aggressive Bullish Setup
• MACD: 7.77 (above signal line 7.54), RSI: 80.90 (overbought), Bollinger Bands: Price at $79.615 (above upper band $73.25)
• 200D MA: $27.22 (far below), 30D MA: $53.14 (support), Key Resistance: $82.50 (52W high)
MP Materials is in a short- and long-term bullish trend, with technicals suggesting continued momentum. The RSI at 80.90 indicates overbought conditions, but strong volume and sector tailwinds justify the rally. Two options stand out for aggressive bulls:

• MP20250815C75 (Call, $75 strike, 8/15 expiry):
- IV: 94.09% (high volatility)
- Delta: 0.668 (moderate sensitivity)
- Theta: -0.7139 (rapid time decay)
- Gamma: 0.0422 (price sensitivity)
- Turnover: $1.96M (high liquidity)
- Leverage Ratio: 15.03% (moderate leverage)
- Payoff (5% upside): $4.88 per contract
This call benefits from high implied volatility and liquidity, ideal for a short-term rally.

• MP20250815C76 (Call, $76 strike, 8/15 expiry):
- IV: 91.32% (high volatility)
- Delta: 0.626 (moderate sensitivity)
- Theta: -0.6958 (rapid time decay)
- Gamma: 0.0454 (price sensitivity)
- Turnover: $381K (solid liquidity)
- Leverage Ratio: 17.37% (strong leverage)
- Payoff (5% upside): $5.38 per contract
This option offers higher leverage and a slightly higher strike, rewarding a breakout above $76.

Aggressive bulls should prioritize MP20250815C75 for immediate liquidity and MP20250815C76 for a higher-risk, higher-reward play. A break above $82.50 could trigger a retest of the 52W high, validating the bullish case.

Backtest MP Materials Stock Performance
MP Materials (NYSE: MP) experienced a significant boost in its stock performance following a 7% intraday surge on August 8, 2025. This surge was fueled by several strategic developments:1. Strategic Partnerships: MP Materials' partnerships with the U.S. Department of Defense and Apple have been instrumental in boosting investor confidence. The company's agreement with the Pentagon to become the largest shareholder and financial backstop has provided a stable foundation, while the $500 million rare earth supply deal with Apple has opened up new revenue streams.2. Stock Offering and Expansion Plans: MP Materials launched a $500 million public offering of common stock, with an underwriters' option to purchase additional shares. The proceeds are earmarked for accelerating and expanding operations, including the 10X Facility, to capitalize on strategic growth opportunities.3. Deutsche Bank's Price Target Increase: Deutsche Bank has tripled its stock price target for MP Materials, projecting a rise to $67, indicating strong confidence in the company's future performance. This increased target reflects the reduced operational risks following the Pentagon's investment and Apple's substantial contract.In conclusion, MP Materials' performance post-7% intraday surge on August 8, 2025, is a result of a combination of strategic partnerships, expansion plans, and positive analyst sentiment. These factors collectively contribute to a bullish outlook for the company's stock.

MP Materials' Rally Gains Strategic Momentum—Act Now
MP Materials’ 7.12% surge is underpinned by a perfect storm of geopolitical tailwinds, strategic partnerships, and sector momentum. The DOD loan and Apple deal provide a clear path to revenue visibility and margin stability, while the rare earth sector’s broader push for domestic production amplifies MP’s relevance. Investors should monitor the $82.50 52W high as a critical breakout level and watch the sector leader, Newmarket (NEU), which rose 0.53% today, for further validation of the rare earth theme. For those seeking leverage, the selected options offer high-reward potential in a market poised for continued volatility. Act decisively—MP’s rally is far from over.